House Keeps Undermining Financial Regulation, Denies Funding To Foreclosure Fraud Task Force

The Nation’s George Zornick noted today that House Republicans — aided by some Democrats — are refusing to appropriate funds for the Residential Mortgage-Backed Securities working group, which is supposed to investigate foreclosure fraud and other mortgage abuses by the financial sector:

Yesterday, Representative Maxine Waters, a member of the caucus, made the first attempt to get the RMBS group funding—and it didn’t work.

She offered an amendment to a large appropriations bill, created by Republicans, that would fund, in part, the Department of Justice. The bill provided only a fraction of the $55 million the DoJ asked for in its budget request for “investigating and prosecuting financial and mortgage fraud.” Waters proposed re-appropriating some money in the bill from the NASA program to fully fund the $55 million request…Unfortunately, when put up for a voice vote, the Waters amendment failed in the Republican-dominated chamber.

The RMBS working group has been slow in getting off the ground, and lack of funding certainly won’t help. Of course, this is standard operating procedure when it comes to the House GOP and financial regulation: having failed to prevent Dodd-Frank from becoming law, they have sought to undermine it by not funding the regulators charged with implementing it.

Case in point, in March, House Republicans refused to fully fund the Securities and Exchange Commission. JP Morgan Chase spends four times the SEC’s entire budget on information technology alone, yet House Republicans think that the SEC already has enough resources to police the financial markets. House Republicans won’t even fund efforts to collect the economic data necessary to prevent future financial crises.

Considering the stories that have come out regarding the banks’ mortgage malfeasance, funding an investigation into their practices should be a no-brainer. Foreclosure scams have already increased 60 percent in 2012.